The market value of a leasehold property in Hatton depends on how many years the lease has remaining. If it is close to or less than eighty years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension prior to buying. It is ideal to start the process of extending the lease is when a lease still has 82 years to run so that a lease extension can be concluded ahead of the 80 year cut off point. Statute enables Hatton qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has fifty years left the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Hatton with over one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| National Westminster Bank | Mortgage term plus 30 years. |
Using our service will provide you increased control over the value of your Hatton leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Callum, came critically close to the eighty-year threshold with the lease on his two bedroom flat in Hatton. In buying his home two decades ago, the unexpired term was of minimal concern. As luck would have it, he realised he needed to take steps soon on Extending the lease. Callum arranged for a lease extension just under the wire in May. Callum and the freeholder in the end agreed on a premium of £5,000 . If he not met the deadline, the premium would have escalated by a minimum £875.
In 2012 we were called by Dr E Howard who, having acquired a ground floor apartment in Hatton in August 1998. The dilemma was if we could approximate the premium could be for a 90 year lease extension. Comparative flats in Hatton with a long lease were valued about £285,000. The mid-range ground rent payable was £45 billed per annum. The lease finished in 2097. Having 72 years as a residual term we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of legals.
An example of a Lease Extension case for a Hatton premises is 147 Redford Close in June 2012. The Tribunal determined the lease extension premium to be at £4,200 This case related to 1 flat. The unexpired residue of the current lease was 82.93 years.